'You Can Be A Student Without A Student Loan' - Dave Ramsey's Advice To Paying Cash For College

Dave Ramsey has always been vocal about his stance on student loans: avoid them at all costs. The Ramsey Show recently shared a clip of Ramsey on their socials where he reinforces this message. 

"You can be a student without a student loan," Ramsey declared, adding that taxpayers are "stupid" for guaranteeing 18-year-olds zero-collateral loans, often upwards of $100,000, for school. "Go to a school you can afford and pay cash."

The Student Loan Crisis in the United States

Student loans have become a major financial burden for millions of Americans. According to the Education Data Initiative, student loan debt in the U.S. has surpassed $1.7 trillion and affects about 42.7 million borrowers. These high monthly payments frequently delay new graduates from achieving key financial and life milestones, like purchasing a home, saving for retirement, and even starting a family.  

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Ramsey argues that the availability of student loans contributes to skyrocketing tuition costs. He points out that the federal government guarantees loans for 18-year-olds with no collateral, often leading to excessive borrowing. "Just because we're idiots and letting you do it, doesn't mean you have to be an idiot and partake," he said on his show.

Ramsey's Advice On Paying Cash for College

Instead of relying on student loans, Ramsey recommends that students choose an affordable college and pay cash. Here are some of the strategies Ramsey Solutions suggests: 

1. Choose a School Within Your Budget

Ramsey emphasizes that students don't need to attend a prestigious university to succeed. Community colleges and in-state public universities offer quality education, typically at a fraction of the cost of private schools. Opting for a lower-cost education helps students avoid unnecessary debt.

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2. Work While in School

One way to pay for college without loans is to work while studying. Ramsey encourages students to take advantage of work-study programs, apply for off-campus jobs, or even start a side business to help cover tuition and living expenses. He argues that balancing work and school teaches financial responsibility and discipline.

3. Apply for Scholarships and Grants

There are tons of scholarship and grant opportunities available for students. Ramsey encourages students to fill out the Free Application for Federal Student Aid and for as many scholarships as they can because it's free money that they don't have to pay back. 

4. Limit housing expenses

A large cost in college is living in college housing on campus with a meal plan. Ramsey Solutions advises cutting this cost by living off-campus, commuting to school, or getting a roommate. 

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The Long-Term Benefits of Avoiding Student Loans

Ramsey centers his approach around financial freedom. Graduating debt-free allows young adults to start their careers without the burden of monthly student loan payments. This financial flexibility makes it easier to save for a home, invest for retirement, and build wealth over time.

For those already burdened with student loans, Ramsey advises aggressive repayment strategies—making extra payments, budgeting wisely, and increasing income to pay off debt as quickly as possible. His philosophy centers on taking control of finances and avoiding the long-term consequences of borrowing for education.

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